Last year, the [Unemployment Insurance D]ivision paid out $1.6 billion in unemployment benefits to 243,000 claimants, the money coming from state and federal unemployment insurance taxes paid by employers. Apparently overpayments are not uncommon as the department last year recorded cumulative receivables of $150 million it was trying to collect from the formerly unemployed, and it actually recovered $25 million in 2011 in overpayments.
If you run the math, almost 10% of the sum of gross Maryland unemployment benefits paid out are reclaimed as overpayments (with adjustments for different payment years, etc.)
In my experience, overpayments are quite common for a number of reasons. Sometimes benefits are initially paid and then reversed, sometimes to be reversed again, due to continued disputes over whether a disqualification (e.g. gross misconduct) actually applies. Sometimes workers are working on the side and get hit not only with repayment orders for overpayment but get all of their benefits disqualified under Maryland’s fairly severe fraud penalties.
It’s common for workers to get reviewed upon exhausting the first round of 26 weeks in benefits; the extended benefits often trigger a major review of benefits eligibility, even reviewing earlier determinations. I often get calls regarding DQs extending from those reviews. Sometimes workers may lose previously paid benefits if they cannot show that they are and have consistently been able, available and actively seeking work.
There is a process by which a claimant facing relatively severe hardship can request consideration for a reduction or waiver in the amount of overpayment of Maryland unemployment benefits; usually this request must be made within 30 days of last adverse decision of any level of the UI Division.